UPDATE 2-G7 finance chiefs ponder flagging growth amid Greek crisis fears

Wed May 27, 2015 3:01pm EDT
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* U.S. expected to press Europe to reach deal on Greece

* Growing importance of Chinese yuan also up for discussion (Adds comments from Canadian finance minister, officials)

By Paul Carrel and David Ljunggren

DRESDEN, Germany, May 27 (Reuters) - G7 ministers and central bank heads convened on Wednesday to discuss how to revive global growth and China's increasing clout, while keeping a close eye on the protracted talks to avoid a Greek default.

Although the Greek crisis is not on the official agenda for the three-day meeting in the German city of Dresden, it will be discussed on the sidelines.

The United States is likely to use the talks, running through to Friday, to press Europe to reach a funding-for-reforms deal with Greece.

U.S. Treasury Secretary Jack Lew said he feared a miscalculation could lead to a new crisis which could have consequences for the wider world and said Greece's creditors may have to give some ground.

"The challenge for the Europeans, the political and economic institutions -- the IMF -- is to show enough flexibility," Lew said in London.

The threat of a Greek default, rising oil prices and bond market turmoil are helping fuel investor nervousness.   Continued...